When measuring Marketing ROI you have to decide on what’s important and how to measure it.

It depends on your marketing objective.

Few companies achieve success when it comes to measuring marketing’s return on investment. This is due to multiple factors beginning with deciding what’s important and how to measure it.

Traditional ROI measurement

One approach to ROI measurement begins with hard data that can be sorted, segmented and formatted showing capital invested and capital returned from the investment. This is a transactional approach that looks at the increase in sales revenue, cost of marketing and the amount of goods and services moved out the door.

The problem with using this type of ROI measurement is that it does not take into account all the factors that can affect sales. For example sales can increase because a competitor went out of business or sales can decrease because a competitor cut their price.

The same is true for digital analytics. There are dozens of B-to-B marketing automation platforms in use that measure a variety of transactional processes such as e-mail open rates, click through, down loads, web page activity. All of this is predicated on transactional responses. Analytic information such as this provides a graphical representation of the buyer’s journey through the sales funnel but does not measure the customer’s emotional connection with the brand.

Measuring the customer’s emotional connection with the brand.

Contrast the above with measuring customer satisfaction. When customers have a positive experience with the brand this usually leads to increased customer loyalty and repeat purchases.

In this case, marketing ROI could be measured in 4 ways.

1. Emotional satisfaction

This ROI measurement deals with customer experiences and how the experience can be measured in terms of quality, reliability, and filling an emotional need.

2. Loyalty measurement

Much like a net promoter score this marketing ROI metric concerns its self with the likely hood of a repurchase and recommendation of the brand to a friend. The metric for measurement would be performance evaluations for product, quality and value.

3. Attribute/benefit satisfaction

Here ROI measurement focuses on customer satisfaction influenced by the perceived quality and service attributes of the product. This is where brand advertising helps shape the customer’s attitude and perception towards the brand. ROI measurement can include:

Product utility (was it useful or not useful)

Product functionality (did it solve the problem at hand or fail to solve the problem)

The ROI measurement is the “post experience” and represents the emotional affect produced by the products quality or value.

4. Repurchase

ROI repurchase measurement now is about predicting the customer’s future action. It’s a behavioral measurement as to the customers experience and the likely hood for repeat purchase and peer recommendation.

Gathering Marketing ROI for the emotional connection that the customer has with the brand is a long-term approach. The information can be transactional but it’s more about perception and how the brand provides an intangible quality that make the customer’s life easier or better.

Large numbers of followers are not an indication of an effective social media strategy

In a recent study, Americans were asked why they used social media. 40% indicated that their reason was to find more information about a company or organization. In addition, 26% of Baby Boomers, 31% of Gen-Xer’s and 43% of Millennials indicated that social media has some influence on their purchasing decisions.

Social media is no longer a numbers game

Early adopters of social media marketing used a shotgun approach to gain followers. Through the use of automated programs, it was relatively simple to add hundreds of followers daily. The resulting appearance was one of connecting and influencing a large audience. The reality was that a majority of the followers were more concerned with adding to their own amplified digital persona than caring about a brand’s product or service offering. Conventional digital wisdom at the time was that large numbers of followers would translate to an equally large number of sales leads and brand advocates. What actually resulted was a dilution of the conversation and insights that can be gleaned from social media.

Quality instead of quantity

Now, B-to-B brands are focusing on acquiring smaller numbers of quality followers that actually have shown an interest in the brand. Actions such as joining in a conversation, participation in a survey, opting in for newsletters, or landing page requests for additional information are digital tools which can bring on quality followers and influencers. This should come as no surprise with the advent of being able to purchase thousands of Twitter followers and Facebook likes for just a few dollars.

Authenticity helps drive brand engagement

The preferred B-to-B social media strategy is to connect with customers and industry influencers. Customers engage with brands when they are already attached to the brands’ product or services. Brands that engage their customers with exceptional service or user experience will in turn drive those customers to engage with them on social media. Brands that try to “hard sell” their product or services on social media are unlikely to see any return whatsoever in sales from those efforts. Companies that consistently monitor their social media platforms and provide timely responses to comments and customer service problems accelerate brand loyalty and increase the opportunity for additional sales.

Post navigation

Search

Bailey Burk

Bailey Burk,
People-to-People Marketing Communications

Bailey Burk is a recognized leader in people-to-people marketing. People-to-people marketing engages decision makers, builds relationships, and creates an emotional connection and preference for your brand. Since 1990 he has helped hundreds of companies differentiate their brand and gain a competitive advantage in their industry.

Contact Bailey at 214-953-0494 for additional information.

Click to learn more . . .

Follow Blog via Email

Enter your email address to follow this blog and receive notifications of new posts by email.